Wall Street is set for a higher open after U.S. bond yields moved to a one-week low in pre-market trading. The 10-year Treasury was trading at 1.5% easing concerns of higher inflation. Congress passed the $1.9 trillion COVID-19 relief bill, which is expected to improve economic growth. Also, the number of Americans filing for unemployment benefits report came in lower than expected. The initial claims were 712,000 down from 754,00 the prior week, showing an improving labor market.
The S&P 500 traded above resistance at 3914.50 but sold off late to close at higher on the day 3898.81. The recent rally has come with lower volume each day, so we still believe a pause with a base is needed. The RSI index did move higher in support of the up move and closed at 54.89. The S&P 500 did break the trend of lower highs which is a bullish signal. We will now move to a short-term bullish stance. The index now has potential resistance at 3914.50 and then 3928.65, and it could have possible support at 3885.76 and then 3870.90. The
We are currently long-term bullish and short-term bullish.
John N. Lilly III CPFA
Accredited Portfolio Management Advisor℠
Accredited Asset Management Specialist℠
Portfolio Manager, RJ
Windsor Wealth Planners & Strategist
Futures trading is speculative, leveraged, and involves substantial risks. Investing always involves risk, including the loss of principal, and futures trading could present additional risk based on underlying commodities investments.
The Relative Strength Index (RSI), developed by J. Welles Wilder, is a momentum oscillator that measures the speed and changes of price movements.
The S&P 500 is an unmanaged index of 500 widely held stocks that is generally considered representative of the U.S stock market. Past performance may not be indicative of future results. Keep in mind that individuals cannot invest directly in any index, and index performance does not include transaction costs or other fees, which will affect actual investment performance. Individual investors’ results will vary. Opinions expressed are those of the author John N. Lilly III, and not necessarily those of Raymond James. “There is no guarantee that these statements, opinions, or forecast provided herein will prove to be correct. “The information contained was received from sources believed to be reliable, but accuracy is not guaranteed. Investing always involves risk, and you may incur a profit or loss. No investment strategy can guarantee success. The charts and/or tables presented herein are for illustrative purposes only and should not be considered as the sole basis for your investment decision. International investing involves special risks, including currency fluctuations, different financial accounting standards, and possible political and economic volatility. Investing in emerging markets can be riskier than investing in well-established foreign markets.
This is not a recommendation to buy or sell any company’s stock mentioned above.
US government bonds and treasury bills are guaranteed by the US government and, if held to maturity, offer a fixed rate of return and guaranteed principal value. US government bonds are issued and guaranteed as to the timely payment of principal and interest by the federal government. Bond prices and yields are subject to change based upon market conditions and availability. If bonds are sold prior to maturity, you may receive more or less than your initial investment. Holding bonds to term allows redemption at par value. There is an inverse relationship between interest rate movements and bond prices. Generally, when interest rates rise, bond prices fall and when interest rates fall, bond prices generally rise.